CSL challenger Aegros partners with Cambodia’s Royal Group to build $615m plasma plant in Singapore

Aegros has delayed a potential ASX float by another year as it completes a flurry of deals and investments to prove that it’s not just another ‘biotech gonna’.

Aegros has partnered with Cambodia’s Royal Group to build a $US400m ($615m) plasma fractionation plant in Singapore as it pushes out a planned ASX-listing by another year.

The company – which is moving its headquarters from Sydney to Brisbane after gaining Queensland government funding to build a separate $450m plant – is aiming to break CSL’s monopoly on Australian plasma processing.

Aegros has also partnered with Fresh Start to build the Singapore factory, which will be capable of processing more than a million ­litres of plasma when completed.

Co-founder Hari Nair said the company’s technology would change the way plasma was fractionated globally. “This deal represents Aegros’ first overseas expansion and in another world first, will use plasma currently collected in Asia which cannot be processed by the existing fractionators,” he said.

Production is expected to begin two years after it finds a suitable location in Singapore, Aegros co-founder John Manusu said.

“The Singapore government is very keen on this sort of thing. It is an interesting country where things happen the way the government wants them to happen, so I don’t think that will be a problem,” Mr Manusu said.

It comes at a busy time for Aegros, which is weeks away from revealing clinical trials for a hyperimmune therapy to treat Covid-19. CSL abandoned plans to develop a similar product early last year after the failure of its trials, which it ran in partnership with Japanese rival Takeda.

Aegros’s Singapore factory will produce plasma products for the Southeast Asian market. Mr Manusu said about two million litres of plasma a year were discarded across Asia because they were not suitable for conventional ­fractionation.

But he said Aegros’s technology had viral removal capability, meaning plasma could be pro­cessed into lifesaving products such as albumin. It also has a disposable cartridge system, meaning if there is a problem the whole plant is not contaminated, just the cartridge, which can be discarded.

“Plasma is a national treasure and it is a travesty that existing processes can’t deal with that,” Mr Manusu said.

“The Asian market represents approximately 60 per cent of the world’s population but only represents approximately 30 per cent of the therapeutic plasma product sales. It is a grossly undersupplied market.”

Aegros staff at work at the company’s Macquarie Park facility. Picture: NCA NewsWire / Dylan Coker

Aegros was planning a $300m-plus listing on the ASX this year but Mr Manusu said that was more likely to happen late next year. “The ASX listing is not a goal. It is an outcome of what our goals are.

“And our goals are: complete the clinical trial for the hyperimmune, get the facility renovated at 5 Eden Park (Macquarie Park in Sydney), which is well under way, and finally get TGA registration of our products so we can get some sales.

“Those are all due to happen by March of 2024. That’s the point where we will press the button and say ‘let’s go for our IPO’. If you just run through the rationale of that, we will list in that case probably in the September to December period next year.”

Mr Manusu said the company was also in the process of engaging a first-tier auditor: Ernst & Young.

“Once we’ve got that, that’s the first step that we’ve got to hit our milestones so we can be seen as a commercially viable organisation and not a ‘biotech gonna’. I’m so over having lived my earlier life as a gonna. You become the living dead. I’m just not going to go there again and we don’t need to because we have too much going for us.”

Plasma fractionation experts have reportedly cast doubt on Aegros’s ability to deliver at scale its technology, which features a four-step process that produces a greater yield than the conventional 15-step process. But Mr Manusu likens detractors to Fairfax Media’s refusal to buy online classified sites such as Seek and carsales.com.au 20 years ago. That company has since merged with Nine Entertainment.

“Fairfax refused to see the future when each one of those was turned into a website, internet-based solution which just whittled them down to a shell of what they were,” Mr Manusu said. “It’s that sort of behaviour that I’m seeing now with existing ­fractionators.”

CSL has doubled down on its existing technology, spending almost $1bn on a new factory in Melbourne which can process up to 9.2 million plasma-equivalent litres a year – a ninefold increase on its current capacity – and export to more than 100 countries.

Mr Manusu said Aegros was close to doing a deal with two existing fractionators – a market dominated by CSL, Grifols, Octopharma and Takeda. But he did not say which company had expressed interest in Aegros.

“CSL we are not talking to, and we cannot, because that would defeat the whole purpose of going to the NBA (National Blood Authority) and saying we want to break the monopoly here.”

In regard to the Singapore project, Royal Group chairman Neak Oknha Kith Meng said: “The world, especially Asia, has a shortage of plasma products which is impacting the wellbeing of so many individuals across all countries. This partnership is a significant step in the progress of health development working towards a goal to give ASEAN countries more availability of plasma treatment products.”

Fresh Start chief executive Daniel Phillips said: “We see our involvement as not only a funder, but as a strategic partner to help this business reach its full ­potential.”